Transforming growth factor-beta (TGF-beta) has previously been implicated in embryonic development and in regulating both cell proliferation and expression of target genes. Of the three TGF-beta isoforms, type 1 TGF- beta is both the most abundant in most tissues and the most acutely regulated in injury and repair and in the pathogenesis of various diseas- es. Although they lack any obvious developmental defects, mice in which the TGF-beta1 gene has been knocked out by targeted disruption die at about 3 weeks of age of multifocal inflammatory disease. We have investigated the possible initiating event in this inflammatory syndrome and found that, prior to detection of any tissue infiltrates, expression of both class I and II major histocompatibility antigens is high in these mice, while generally undetectable in comparable tissues in normal littermates, suggesting that TGF-beta may be a natural repressor of MHC antigen expression. Moreover, we have found that the surprisingly normal development of these mice results from transfer of TGF-beta1 protein from the heterozygous mothers, both transplacentally and in the milk. By dosing with an immunosuppressant, dexamethasone, to extend the life of a female homozygous for the mutant allele, we have achieved a term delivery and been able to demonstrate that TGF-beta1 (-/-) pups born to a TGF-beta1 (-/-) mother have severe developmental defects, especially in cardiogenesis. Normal cardiogenesis is supported either by maternal transfer of TGF-beta1 from heterozygous mothers to TGF-beta1 (-/-) pups or by endogenous synthesis of TGF-beta1 in heterozygous pups born to null mothers. This demonstrates a critical role of TGF-beta1 in cardiogenesis; the role of maternal transfer of TGF-beta1 in normal physiology is not known at present.